Saturday, October 4, 2008

Mitch McConnell and the 24 year itch

Mitch McConnell and the 24 year itch

“Tell me you're trying to cure a seven-year ache
See what else your old heart can take.”

-Rosanne Cash

Kentucky Senator (and Republican Minority Leader) Mitch McConnell is in a tight race for re-election with challenger Bruce Lunsford.

If you look at history, that is not surprising.

McConnell was first elected to the Senate in 1984. He has been re-elected four times since then.

According to the classic political science book, U.S Senators and Their World, by Donald Matthews, it is harder for a Senator to get re-elected for a fourth or fifth term, than to be re-elected after one.

Matthews showed that 80% of all Senators got re-elected after one term, and that number increased to 84% for a second term and 88% for a third. The re-election odds drop to 57% for those seeking four or more terms.

Matthews wrote his book in 1960 but I doubt that the theory has changed.

I did a study of Matthew’s book when I was in graduate school at Vanderbilt. The logic is surprisingly simple. When someone has been in the Senate for 24 years or more, the group of supporters that first got them elected have died or lost interest in politics. Along the way, the Senator is building up enemies.

Enemies have longer memories. People might forget a favor but never forget something done to them.

Thus, human behavior favors a challenger.

The revenge factor is a problem for a candidate like McConnell. McConnell ran aggressive and polarizing campaigns in his four bids for Senate and in his earlier races for Jefferson County (Louisville) Judge Executive.

His elections were hotly contested, including a 1996 defeat of current Governor Steve Beshear. Thus, he has a sitting Governor waiting in line to take him down.

Unlike many other senators, McConnell has played an active role in Kentucky politics at every level. He was instrumental in electing former Governor Ernie Fletcher that cooled after Fletcher’s election.

The internal participation could benefit McConnell as he developed a strong group of allies but, going back to Matthew’s theory, McConnell’s involvement developed another group of enemies that could spring out if a challenger has a chance to defeat McConnell.

Matthews noted the blessing of seniority could also be a curse. Senators with increased seniority take on more responsibility and important assignments within the Senate.

Matthews said “in the vocabulary of social psychology, his ‘reference groups’ change, he becomes more concerned with Senate, national and international problems and devotes less time and attention to the ‘folks back home”.

McConnell is the Senate’s highest ranking Republican and a staple on the Washington Sunday morning talk shows. He has had to promote the political agenda of an unpopular president.

President Bush was an asset when McConnell ran for his fourth term in 2002. Bush was at his peak of popularity after September 11, 2001. McConnell was running against a relatively unknown challenger.

In 2008, the situation is different. John McCain, the Republican nominee, goes out of his way to differentiate himself from the President.

McConnell can’t “untie” his association with President Bush.

His role as Minority Leader does not give him personal political flexibility. A good example was Bush’s proposal for a $700 bailout for Wall Street.

McConnell’s fellow Kentucky Republican, Senator, Jim Bunning, took the politically popular position of opposing a bailout. Bunning had previously opposed President Bush’s selection of Alan Greenspan and later Ben Bernanke as Chairmen of the Federal Reserve Board. His opposition was consistent with his stated philosophy.

As Minority Leader, McConnell does not have the luxury of choosing philosophy over party.

The other reasons that Matthews cites, age and not spending time at home, don’t apply to McConnell. Only 66, McConnell works hard at staying in touch.

The next month will show whether McConnell can break the “four term curse.” Lunsford is not the strongest candidate the Democrats could have fielded. He has never held office and lost two consecutive bids for Governor.

Some of officeholders mentioned were Auditor Crit Luellan, former Attorney General Greg Stumbo, former Treasurer Jonathan Miller, current Attorney General Jack Conway and Lt. Governor Daniel Mongardo. All would have been strong candidates but only Lunsford answered the call.

According to the research of Professor Matthews, that call might result in Lunsford changing his name from Citizen Lunsford to Senator Lunsford.

Don McNay is the author of Son of a Son of a Gambler. You can read his award winning, syndicated column at or write to him at McNay is the Treasurer for the National Society of Newspaper Columnists.

Friday, October 3, 2008

If Dave Ramsey were President

Wednesday, October 1, 2008

From Editor & Publisher: McNay is on the Air and in Print With Financial-Crisis Commentary

McNay is on the Air and in Print With Financial-Crisis Commentary

By E&P Staff

Published: October 01, 2008 11:15 PM ET
NEW YORK Syndicated financial columnist Don McNay is continuing to write and comment about America's financial crisis.

Yesterday, for instance, he taped a segment with WTVQ-TV in Lexington, Ky. And this morning, McNay was scheduled to appear on 1190 KEX News Radio in Portland, Ore.

In his most recent column on the financial crisis, McNay wrote: "The leadership styles of President Bush and Secretary of the Treasury Hank Paulson have contributed to the problem. Great presidents reassure the country in times of crisis. Look at Teddy Roosevelt, Franklin Roosevelt, Abraham Lincoln, and George Washington.

"I've never seen a great president scold or scare the American people into going along with a program. Both Paulson and Bush showed neither confidence, nor optimism. They seemed nervous and distracted. They didn't appear to have a handle on the situation."

McNay is treasurer of the National Society of Newspaper Columnists

Tuesday, September 30, 2008

Don McNay on WTVQ in Lexington and 11190.KEX in Portland Oregon

I taped a segment with Greg Stotelmyer at WTVQ-TV in Lexington today (Tuesday,. September 30) that wlll run on their evening news.

Tomorrow (October 1) I am doing a live segment with Paul Linnman on news radio 1190.KEX in Portland Oregon. I should be on at 8.15 am (EDT). You can pick up. the show via podcast and live streaming.

I also was quoted in the Richmond Register news story and will include a link to that.

Morning Show on 1190.KEX in Portland Oregon


Richmond Register, page 1, September 30 2008

I'm going to keep doing special columns while the economic crisis goes on. I've also been doing non stop media appearances, including two with Joe Elliott (4 pm and again at 5.30 pm.) on WHAS-84 yesterday.

As noted last week:

Dave Astor at Editor and Publisher Magazine did a terrific story about my column concerning the economic crisis and Senator Bunning. I've gotten response to Dave's column from all over the United States.

Here is the link.

Dave Astor's story about Don McNay column in Editor and Publisher

Editor & Publisher story

Monday, September 29, 2008

Dave Ramsey for President

Dave Ramsey for President.

Just one more year and then you’d be happy
But you’re crying, you’re crying now.

-Gerry Rafferty

As the financial crisis has played out, the leadership styles of President Bush and Secretary of the Treasury Hank Paulson have contributed to the problem.

Great presidents reassure the country in times of crisis. Look at Teddy Roosevelt, Franklin Roosevelt Abraham Lincoln, and George Washington.

I've never seen a great president scold or scare the American people into going along with a program.

Both Paulson and Bush showed neither confidence, nor optimism. They seemed nervous and distracted. They didn’t appear to have a handle on the situation.

President Bush was unable to get his fellow Republican in Congress to go along with the program that he proposed.

The President claimed dire consequences if the Wall Street bailout failed, but his party voted against him anyway.

Paulson's friends on Wall Street didn't like the rebuke. They struck back. The Dow Jones average dropped 777 points and one day. It was the 17th largest percentage drop in history.

Bush and Paulson don’t have a great track record. We are still looking for Bush’s “weapons of mass destruction” and Paulson has mistakes that has turned a recession into a possible depression.

I’ve been hoping that a presidential candidate would take charge and lead us.

Barack Obama has been very cool and calm. Maybe a little too cool. He has not offered specific and concrete ideas. He often talks in techno jargon and legalese.

Obama may not be ideal but he belongs on Mount Rushmore compared to the antics of John McCain.

McCain first declared that the economic fundamentals of the nation were strong. Then he changed his mind, and decided he was going to suspend his campaign, cancel the first presidential debate, and come back to Washington to assist the bailout.

He interjected himself into the negotiations. He decided on Friday that things look good and went back to campaigning. They weren’t but he left anyway. He tried to take credit for getting fellow Republicans to back the President.

Thus, he has egg on his face when the Republicans torpedoed the President’ bill.

I was running out of hope for an American showing true leadership, when I happened to flip on the Fox Business Network to catch the Dave Ramsey Show.

Personal finance is Dave’s thing. One look at him and you saw a guy who knew what he was doing. He was calm and in charge. He didn’t act nervous like Paulson and Bush.

Ramsey framed the issues in a way that Americans could understand.

He told people to ignore the “sky is falling” histrionics that some news channels were touting.

Ramsey looked at the bailout from the perspective someone on Main Street. Just like Ramsey’s opposition to Bush’s ill fated ‘tax rebate” giveaway, Dave reminded us that a $700 billion bailout would destroy the futures of our children.

Ramsey said the world wasn’t ending and he wasn’t cashing in his 401k or taking his money out of the bank.

Like many Americans, he didn’t see the need for the bailout. He noted that 90% of his radio listeners and 74% of the people who participated in his online poll were against it.

Dave said that we needed to ignore the horror stories being pushed by the Wall Street gang, that people wouldn’t be able to ‘buy their dishwashers.” He said he talked to car dealers making loans and realtors selling homes.

He said the tightening of credit meant that “broke people couldn’t get a loan” and that wasn’t all bad.

He was calm and optimistic. Like good leaders are in times of crisis.

He was more like Winston Churchill than Chicken Little.

Ramsey spent an hour taking questions from average citizens. Like President Bush should have.

If President Bush had Dave Ramsey’s communications skills, he might have explained the bailout in a way that the average American could grasp. He might have passed his package.

On the other hand, Dave Ramsey doesn’t believe in debt. Of any kind. If Dave had been president for the past 8 years, we wouldn’t need a bailout to begin with.

Vote for Dave.

Don McNay is Chairman of the Board for McNay Settlement Group in Richmond Kentucky. You can read his award winning, syndicated column at or write to him at McNay is the Treasurer for the National Society of Newspaper Columnists.

Im writing a column saying that Dave Ramsey should be president

I'll post in a couple of hours

Sunday, September 28, 2008

Wall Street’s Disconnect with Main Street

Wall Street’s Disconnect with Main Street

“Nobody has ever taught you how to live out on the street
and now you're gonna have to get used to it.”

-Bob Dylan

I didn’t know if I agreed or disagreed with the initial $700 billion Wall Street bailout until Treasury Secretary Hank Paulson confirmed that he opposed capping pay for corporate executives.

Paulson said that it was “punitive” and would “discourage institutions from participating in the program.”

According to Hank, a corporate president would let a company go broke, its employees get fired and its investors lose all their money before the executive would give up their limousines, yachts and stock options.

The scary thing is that Paulson sincerely believed it. It was based on his knowledge of his fellow Wall Streeters.

Paulson is the Treasury Secretary. If his original proposal passed, Paulson would have been more powerful than the President of the United States.

And totally clueless.

If Paulson is so out of touch on executive pay, the rest of his program might be based on faulty data too. We went to war in Iraq based on faculty data. Just once, I would like for the government to do its homework first

Outside of Hank and his buddies on Wall Street, no one is in favor of perks for executives. It is an issue that might cause people to march in the streets.

Paulson seems disconnected from that fury. He is also disconnected from those who make their living on Main Street.

I’ve run a business all of my adult life, just like my dad did. My children run one now.

We all understand one principle. If we go broke, we go broke. I’ve never had a loan that I did not personally guarantee. If my businesses go down, they take everything.

My father lived to avoid the “take everything” moment. Just like I have. No matter how much money you have, a business owner never gets that “take everything” moment out of their minds. It is part of their psyche.

It’s obviously not part of the Wall Street psyche.

I’m not a typical Wall Street basher. I love capitalism. I’ve been involved in the financial business for 26 years and believe in the markets. I have many friends on “the street” and I feel for those losing their jobs.

I don’t feel for the top dogs leaving with millions.

The attitude that Paulson stated, that executive compensation is more important than the overall health of a company, is pervasive on Wall Street. It is a primary reason for the crisis.

Somewhere along the way, those companies forgot two things:

1. They are investing other people’s money.
2. Their stockholders trusted the company to make them money.

The people who run the Wall Street companies aren’t owners like those on Main Street. They work for thousands of stockholders.

The executive’s first responsibility should be their customers, stockholders and employees. The limo and yacht shouldn’t make the list.

If the big dogs on Wall Street had been owners, like us on Main Street, they would have watched their bottom lines a little harder. They might have kept an eye on investments and been more cautious.

They might have avoided the crisis.

Wall Street executives never feared the “take everything” moment. It wasn’t their money they were risking. The people at the top knew they could retire with millions.

They acted like they were at a casino where someone else was supplying the chips.

Now they want a new player in the game, the taxpayer.

The recently defunct companies had common bond, I never invested in them. I knew some top management and they came across as arrogant jerks. They treated me like a yokel from a small town.

Management arrogance the surest way to ruin a business. No matter how big or small. My dad used to say “for those who think they are smarter than the game, the game has a way of catching them”.

If the Wall Street leaders have any shot of turning their businesses around, someone needs to teach them how to live out on the street.

The way we on Main Street do.

You can read Don McNay’s award winning column at or write to him at McNay is the Treasurer for the National Society of Newspaper Columnists.